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FILED
United States Court of Appeals
PUBLISH Tenth Circuit
UNITED STATES COURT OF APPEALS July 27, 2026
Christopher M. Wolpert
FOR THE TENTH CIRCUIT Clerk of Court
AMERICAN CAR RENTAL
ASSOCIATION, a District of Columbia
corporation,
Plaintiff - Appellant,
v. No. 25-1246
HEIDI HUMPHREYS, in her official
capacity as Executive Director of the
Colorado Department of Revenue;
SHOSHANA LEW, in her official capacity
as the Executive Director of the Colorado
Department of Transportation; CECIL
GUTIERREZ, in his official capacity as the
Chair of the Colorado High-Performance
Transportation Enterprise,
Defendants - Appellees.
------------------------------WASHINGTON LEGAL FOUNDATION,
Amicus Curiae.
Appeal from the United States District Court
for the District of Colorado
(D.C. No. 1:24-CV-02450-DDD-KAS)
Daniel H. Schlueter (Jeffrey A. Friedman, with him on the briefs), Eversheds Sutherland (US) LLP, Washington, DC, appearing for Appellants.
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Pawan Nelson, Senior Assistant Attorney General (Philip J. Weiser, Attorney General, and Shelby A. Krantz, Assistant Attorney General, with her on the brief), Office of the Attorney General for the State of Colorado, Denver, Colorado, appearing for the Appellees.
Cory L. Andrews, Washington Legal Foundation, Washington, DC, filed an amicus curiae brief in support of Appellant.
Before MATHESON, EID, and CARSON, Circuit Judges.
MATHESON, Circuit Judge.
In 2024, the Colorado General Assembly enacted a law imposing a
“congestion impact fee” of up to $3 per day on all short-term vehicle rentals (“the
Fee”). Colo. Rev. Stat. § 43-4-806(7.6)(a)(i). Plaintiff American Car Rental
Association (“ACRA”) sued under 42 U.S.C. § 1983, claiming the federal Anti-Head
Tax Act (“AHTA”) preempts the Fee.
The relevant AHTA provision forbids a State to “levy or collect a tax, fee, or
charge . . . upon any business located at a commercial service airport . . . that is not
generally imposed on sales or services by that State.” 49 U.S.C. § 40116(d)(2)(A)(v)
(“Subsection (v)”).
In district court, the parties focused on the phrase “not generally imposed on
sales or services.” ACRA argued that AHTA bars the Fee because it applies only to
car rentals and not all “sales and services.” The State defendants argued the Fee
complies with AHTA’s “generally imposed on sales or services” because it applies
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both to airport and non-airport car rentals. The district court agreed with the State
defendants and granted their summary judgment motion.
We affirm for a different reason, which the parties addressed in supplemental
briefs. Colorado imposes the Fee on consumers. The AHTA prohibits a fee “upon
any business located at a commercial service airport.” It therefore does not apply to
the Fee and does not preempt the Colorado law.
I. BACKGROUND
A. The Anti-Head Tax Act
The AHTA traces its origins to Evansville-Vanderburgh Airport Authority
District v. Delta Airlines, Inc., 405 U.S. 707 (1972). There, the Supreme Court
addressed “whether a charge by a State or municipality of $1 per commercial airline
passenger to help defray the costs of airport construction and maintenance violates
the Federal Constitution.” Id. at 709. The Court said no, holding “that the
Commerce Clause does not prohibit States or municipalities from charging
commercial airlines a ‘head tax’ on passengers boarding flights at airports within the
jurisdiction, to defray the costs of airport construction and maintenance.”
Nw. Airlines, Inc. v. Cnty. of Kent, 510 U.S. 355, 362 (1994) (citing Evansville,
405 U.S. at 707).
Shortly after Evansville, “Committees in both Houses of Congress held
hearings on local taxation of air transportation.” Aloha Airlines, Inc. v. Dir. of Tax’n
of Haw., 464 U.S. 7, 9 (1983). “Both Committees concluded that the proliferation of
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local taxes burdened interstate air transportation.” Id. To address this problem,
Congress enacted the Airport and Airway Development Acceleration Act of 1973
(“AADA”). Id. at 9-10. The AADA included 49 U.S.C. § 1513, which is commonly
referred to as the AHTA and prohibited taxes on air passengers and air commerce.
Id. at 10.
In 1994, Congress reenacted the AHTA, expanding federal restrictions beyond
air travel to businesses located at commercial service airports and businesses
operating as permittees of such airports. See 49 U.S.C. § 40116(a)(d)(2)(A)(iv).
This new provision prohibited states and their political subdivisions from levying or
collecting taxes, fees, or charges “exclusively upon any” of these businesses. Id.
State and local governments began circumventing the AHTA by imposing
taxes and fees that targeted airport-based businesses, including rental car businesses.
See generally 164 Cong. Rec. H3590-05, H3597 (daily ed. Apr. 26, 2018) (statement
of Rep. Graves) (noting “local and State governments [were] targeting certain
industries for discriminatory taxes, like the rental car industry”). Congress became
concerned that these taxes and fees had the same effect as the head taxes that the
AHTA expressly prohibited.
In 2018, Congress enacted Section 159 of the FAA Reauthorization Act of
2018, Pub. L. No. 115-254, 132 Stat. 3186, adding Subsection (v) to the AHTA to
prohibit these types of taxes and fees. See 49 U.S.C. § 40116(d)(2)(A)(v) (2019).
As currently codified, § 40116(d)(2)(A)(v) provides:
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(d) Unreasonable burdens and discrimination against interstate commerce.
***
(2)(A) A State, political subdivision of a State, or authority acting for a State
or political subdivision may not do any of the following acts because those
acts unreasonably burden and discriminate against interstate commerce:
***
(v) except as otherwise provided under section 47133 [which addresses
local taxes on aviation fuel], levy or collect a tax, fee, or charge, first taking
effect after the date of enactment of this clause [i.e., October 5, 2018],
upon any business located at a commercial service airport or operating as
a permittee of such an airport that is not generally imposed on sales or
services by that State, political subdivision, or authority unless wholly
utilized for airport or aeronautical purposes.
49 U.S.C. § 40116(d)(2)(A)(v).
B. Colorado’s Congestion Impact Fee
On May 16, 2024, the Colorado General Assembly enacted, and the Governor
signed into law, S.B. 24-184. In SB 24-184, the General Assembly found:
All rental cars, regardless of where they are rented, use public highways
and have a large impact on our public highway systems, adding
congestion, wear and tear, and more greenhouse gas (GHG) emissions.
Additional cars on our roads from out-of-state visitors, in-state leisure
travel, heavy trucks, and vans for moving services have a documented
impact, and investments in offsets such as transit and rail services benefit
the drivers of those rental vehicles by reducing the amount of traffic
congestion that they encounter throughout the state. A generally
applicable fee on short-term vehicle rentals would equitably support
investment in such offsets to reduce congestion on the public highway
system.
S.B. 24-184, Section 1(d), 74th Gen. Assemb., 2d Reg. Sess. (Colo. 2024).
SB 24-184 directed that Colorado Revised Statute § 43-4-806 be amended to add
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subsection (7.6), which reads, “on and after January 1, 2025,” the Colorado High
Performance Transportation Enterprise (“CTE”) 1 “shall impose a congestion impact
fee on all short-term vehicle rentals at a maximum rate” of up to $3 per day (to be
subsequently adjusted for inflation). Colo. S.B. 24-184, Section 13; see also
Colo. Rev. Stat. § 43-4-806(7.6)(a)(I).
The statute defines a “Short-term vehicle rental” as any motor vehicle “with a
gross vehicle weight rating of twenty-six thousand pounds or less that is rented
within Colorado for a period of not more than thirty days.” Colo. Rev. Stat.
§ 43-4-806(7.6)(a)(II)(D). It “includes rentals of passenger vehicles as well as heavy
motor vehicles like U-Haul trucks.” App., Vol. I at 226 (citing Colo. S.B. 24-184,
Section 1(j)). As the State defendants explain, the Fee “applies to all short-term
vehicle rentals throughout the State, regardless of where the vehicle is rented.” Id.;
see Colo. Rev. Stat. § 43-4-806(7.6)(a)(I) (“the transportation enterprise shall impose
a congestion impact fee on all short-term vehicle rentals” (emphasis added)).
C. Procedural Background
ACRA is a non-profit corporation. App., Vol. I at 7. “ACRA’s members
include car rental businesses that operate in Colorado” and other jurisdictions. Id.
1
CTE is a government-owned business within the Colorado Department of
Transportation.
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ACRA sued defendants Heidi Humphreys, the Executive Director of the
Colorado Department of Revenue; Shoshana Lew, the Executive Director of the
Colorado Department of Transportation; and Cecil Gutierrez, the Chair of CTE
(collectively, “State defendants”). The complaint alleged that the Fee “facially
violates” Subsection (v) of the AHTA and the FAA Reauthorization Act. Id. Count
One sought a declaratory judgment that “[t]he Fee is preempted by” Subsection (v)
and is thus “invalid . . . and that it violates rights secured under the AHTA and the
FAA Reauthorization Act.” Id. at 11. Count Two sought a permanent injunction
preventing defendants from “enforcing [the] illegal Fee.” Id. at 12.
The parties filed opposing summary judgment motions. The district court
denied ACRA’s motion and granted the State defendants’ motion. The court held
that Subsection (v) does not preempt the Fee.
II. DISCUSSION
On appeal, ACRA argues the district court erred in concluding that
Subsection (v) does not preempt the Fee. We disagree and affirm.
A. Standard of Review
“We review a grant of summary judgment de novo, drawing all reasonable
inferences and resolving all factual disputes in favor of the non[-]moving party.”
Moxie Pest Control (Utah), LLC v. Nielsen, 164 F.4th 1195, 1202 (10th Cir. 2026)
(quotations omitted). “We affirm summary judgment if there is no genuine dispute as
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to any material fact and the movant is entitled to judgment as a matter of law.” Id.
(quotations omitted), see Fed. R. Civ. P. 56(a).
“The interpretation of a federal statute is a question of law which this court
reviews de novo.” United States v. Dep’t of Health & Env’t, 162 F.4th 1238, 1244
(10th Cir. 2025). Likewise, we review de novo the interpretation of a state statute.
Cent. Kan. Credit Union v. Mut. Guar. Corp., 102 F.3d 1097, 1104 (10th Cir. 1996).
B. Federal Preemption
Under the Constitution’s Supremacy Clause, U.S. Const. art. VI, cl. 2, the
Supreme Court has “long recognized that state laws that conflict with federal law are
without effect.” Altria Grp., Inc. v. Good, 555 U.S. 70, 76 (2008) (quotations
omitted). “Pre-emption may be either expressed or implied, and is compelled
whether Congress’ command is explicitly stated in the statute’s language or
implicitly contained in its structure and purpose.” Gade v. Nat’l Solid Wastes Mgmt.
Ass’n, 505 U.S. 88, 98 (1992). Express preemption occurs when Congress has
employed “explicit pre-emptive language” in a statute. Id.; see US Airways, Inc. v.
O'Donnell, 627 F.3d 1318, 1324 (10th Cir. 2010). 2
As the parties agree, Subsection (v) contains “explicit pre-emptive language.”
Gade, 505 U.S. at 98; see Altria, 555 U.S. at 76 (noting that “Congress may indicate
2
ACRA argues express preemption and has not made a “structure and purpose” challenge to the Fee.
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pre-emptive intent through a statute’s express language”). We must determine
whether the Fee falls within Subsection (v)’s scope. We “focus on the plain
wording” of the statute, “which necessarily contains the best evidence of Congress’
pre-emptive intent.” Puerto Rico v. Franklin Cal. Tax-Free Tr., 579 U.S. 115, 125
(2016) (quotations omitted).
C. Subsection (v) and the Fee
Subsection (v) provides that “[a] State . . . may not . . . levy or collect a tax,
fee, or charge . . . upon any business located at a commercial service airport or
operating as a permittee of such an airport.” 49 U.S.C. § 40116(d)(2)(A)(v)
(emphasis added). There is no dispute that the statutory term “fee” in Subsection (v)
encompasses the Fee, and because Subsection (v) plainly limits its prohibition to
“any business,” the threshold question is whether the State of Colorado “lev[ies] or
collect[s]” the Fee “upon any business located at a commercial airport.” We
conclude it does not.
The Parties’ Arguments
ACRA argues “the Fee is ‘imposed’ on the rental transactions” and that
“[b]usinesses making the rentals are liable for the Fee and are required to file returns
and make corresponding payment of the Fee to the Colorado Department of Revenue
on a monthly basis.” Aplt. Supp. Br. at 1. “Consequently, the Fee is ‘levied’ or
‘collected’ on rental businesses located at the airport . . . .” Id.
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The State defendants counter that “the Fee is imposed on consumers who rent
short-term vehicles in Colorado.” Aplee. Supp. Br. at 1. They argue that rental car
businesses, including those located at airports, “collect the Fee from consumers and
submit it to the [Colorado] Department [of Revenue] in the same manner as” sales
taxes and “Colorado’s daily vehicle rental fee.” Id. at 3-4. 3
The Colorado Statute
To resolve these arguments, we turn to the text of the Colorado statute that
created the Fee. See Sac & Fox Nation of Mo. v. Pierce, 213 F.3d 566, 578 (10th Cir.
2000) (in determining “upon whom the legal incidence of a tax rests,” a court first
looks to see if the statutory language is “dispositive”; if not, “the question is one of
fair interpretation of the taxing statute as written and applied” (quotations omitted)).
It provides that the CTE “shall impose [the Fee] on all short-term vehicle rentals at a
maximum rate . . . that is reasonably calculated to generate only the amount of
revenue needed to pay the overall costs of providing the services to fee payers that
3
Colorado law imposes a “daily vehicle rental fee . . . on all short-term vehicle rentals at the rate of two dollars per day” and requires “[t]he rental invoice” to “list the daily vehicle rental fee separately as a Colorado road safety program fee.” Colo. Rev. Stat. § 43-4-804(1)(b)(I)(A). The law further provides that “[t]he state treasurer shall credit the daily vehicle rental fees . . . to the highway users tax fund.” Colo. Rev. Stat. § 43-4-804(1)(b)(II). “All moneys in the highway users tax fund are appropriated for the acquisition of rights-of-way for, and the construction, engineering, safety, reconstruction, improvement, repair, maintenance, and administration of” state and county highways, “city street systems, and other public roads and highways” in the state. Colo. Rev. Stat. § 43-4-204.
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will be funded with that revenue.” Colo. Rev. Stat. § 43-4-806(7.6)(a)(I) (emphasis
added). The statute does not define “fee payers.” But the italicized language plainly
indicates that “fee payers” are those persons or entities benefitting from the services
funded by Fee revenue.
Although subsection (7.6)(a)(I) does not identify what those “services” are,
other subsections do. Subsection (7.6)(b) provides that collected Fees shall be
credited by the Colorado state treasurer to the State’s “transportation special fund.”
Colo. Rev. Stat. § 43-4-806(7.6)(b). Subsection (3)(d) provides that the CTE “may
expend moneys in the transportation special fund to pay [revenue] bond obligations,
to fund surface transportation infrastructure projects, and for the acquisition of land
to the extent required in connection with any surface transportation infrastructure
project.” Colo. Rev. Stat. § 43-4-806(3)(d). And subsections (1)(a) and (1.5)(a)(I)
provide that “surface transportation infrastructure projects” are intended, in part, to
“provide diverse, multimodal transportation options that reduce traffic congestion
and degradation of existing surface transportation infrastructure,” “offer more
transportation choices for system users,” and “reduce wear and tear on and increase
the reliability, safety, and expected useful life of state highways and bridges.”
Colo. Rev. Stat. §§ 43-4-806(1)(a), (1.5)(a)(I).
These provisions align with the Colorado General Assembly’s findings that led
to the enactment of the statute—that investment in “offsets such as transit and rail
services” would “benefit the drivers of . . . rental vehicles by reducing the amount of
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traffic congestion they encounter throughout the state.” Colo. S.B. 24-184,
Section 1(d).
We conclude that the phrase “fee payers” in subsection (7.6)(a)(I) refers to the
persons who rent vehicles, and not car rental businesses. 4 Those persons, not car
rental businesses, will benefit from the “services” provided by the “surface
transportation infrastructure projects” funded by the Fee.
The last sentence of subsection (7.6)(a)(I) lends further support. It provides
that “[a] car sharing program shall collect the congestion impact fee for any
short-term vehicle rental of twenty-four hours or longer that is enabled by the car
sharing program.” Colo. Rev. Stat. § 43-4-806(7.6)(a)(I). The statute defines “car
sharing program” to mean “a person that is in the business of operating an online
platform to connect third-party vehicle owners with third-party vehicle drivers to
enable peer-to-peer car sharing within Colorado.” Colo. Rev. Stat.
§§ 6-1-1202(4)(a), 43-4-806(7.6)(a)(II)(B). Car sharing programs do not rent
4
The dissent argues that “[b]y focusing on the phrase ‘fee payers’ in Colo. Rev. Stat. § 43-4-806(7.6)(a)(I)” we “overlook[] the broader statutory framework supporting the Congestion Impact Fee.” Dissent at 3. But that is not so. As we more fully discuss, in addition to Colo. Rev. Stat. 43-4-806(7.6)(a)(I), we draw from five surrounding provisions to support our interpretation—Colo. Rev. Stat. §§ 43-4-806(7.6)(b), 806(3)(d), 806(1)(a), 806(1.5)(a)(I)—and from the Colorado General Assembly’s findings, S.B. 24-184.
The dissent also states the Fee “operates upon airport businesses.” Dissent at 3. But as noted above, the Fee applies throughout the state to “all short-term vehicle rentals,” including car sharing programs. Colo. Rev. Stat. § 43-4-806(7.6)(a)(I).
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vehicles to consumers. By directing them to collect the Fee for any short-term
vehicle rentals they facilitate, subsection (7.6)(a)(I) undercuts ACRA’s assertion that
Colorado imposes the Fee on car rental businesses rather than consumers. It instead
supports the State defendants’ position that Colorado imposes the Fee on consumers
and that car rental businesses (as well as car sharing programs) are merely obligated
to collect the Fee and forward it to the Colorado Department of Revenue. 5
In sum, even if “fee payers” were not plainly a reference to consumers on its
own, a “context dependent term often draws its meaning from surrounding
provisions,” Harrington v. Purdue Pharma L.P., 603 U.S. 204, 218 (2024) (citation
and quotations omitted), and those provisions here show the statute imposes the Fee
on consumers. See generally Gundy v. United States, 588 U.S. 128, 141 (2019) (“It
is a fundamental canon of statutory construction that the words of a statute must be
5
The dissent asserts that the “[m]ost important[]” part of its analysis is that “car rental companies have no obligation under Colorado law to pass the . . . Fee on to their customers.” Dissent at 3. But that assumes the Fee is imposed on car rental companies. Under the statutory framework, the Fee is imposed on “fee payers”—the consumers who rent vehicles, and the role of car rental companies and car sharing programs is only to collect and forward the Fees to the Colorado Department of Revenue.
The dissent also argues that the “cross-reference” in Colo. Rev. Stat. § 43-4-806(7.6)(b) to Colo. Rev. Stat. § 43-4-804(1)(b)(II) concerning daily vehicle rental fees “does not include § 43-4-804(1)(b)(I)(A)’s requirement that car rental invoices separately list the Fee, nor any other requirement that the Fee be passed along to end users.” Dissent at 3-4. But this argument ignores the overall statutory scheme that plainly imposes the Fee on consumers.
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read in their context and with a view to their place in the overall statutory scheme.”
(quotations omitted)).
ACRA’s Additional Arguments
ACRA’s additional arguments are unavailing. They generally ignore the
Colorado statute creating the Fee.
First, ACRA refers us to “a tax return” in the record as support for its
position. 6 Aplt. Supp. Br. at 3. This Colorado Department of Revenue document is
titled “Motor Vehicle Daily Rental Return.” App. Vol. II at 320. Under the heading
“General Information,” the form states that “[t]he daily vehicle rental fee and
congestion impact fee are the two fees that are components of the motor vehicle daily
rental fee and are imposed on all . . . motor vehicle rentals of 30 days or less, and . . .
car sharing rentals lasting 24 hours or longer.” Id. Under the heading
“Who Must File,” the form states that “[i]f you rent motor vehicles for 30 days or
less, you must collect and remit the motor vehicle daily rental fee for each day a
vehicle is rented for 30 days or less.” Id. (emphasis added). It further provides that
“a car sharing program that rents a motor vehicle for 24 hours or longer must collect
and remit the motor vehicle daily rental fee for each day the car sharing vehicle is
rented for 30 days or less.” Id. (emphasis added). And under the heading “Payment
6
The form actually addresses fees rather than taxes. As the Colorado General Assembly has made clear, “the revenue collected by the [CTE] from user fees is generated by fees, not taxes.” Colo. Rev. Stat. § 43-4-806(1.5)(b).
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and Submission,” the form directs the person or entity completing the form to “sign
and date” it and “mail it with payment to” the “Colorado Department of Revenue.”
Id. 7
Considering the document as a whole, we conclude the form supports the State
defendants’ position that Colorado imposes the Fee on consumers and tasks car rental
businesses and car sharing programs with collecting and remitting the Fee to the
Colorado Department of Revenue.
Second, ACRA correctly points out that “there is no mechanism for the State
to collect unpaid Fees from customers” and that the State must instead rely on car
rental businesses and car sharing programs to collect the Fee. Aplt. Supp. Br. at 4.
But as the State defendants noted at oral argument, 8 this approach is no different
from state sales taxes, which businesses collect from consumers and remit to the
State. See First Agric. Nat’l Bank v. State Tax Comm’n, 392 U.S. 339, 347 (1968)
7
The dissent states this form requires car rental “companies to calculate the ‘daily rental fee due’—and send along a corresponding payment—regardless of whether they collected the Fee from their customers.” Dissent at 5. But the form still requires them to collect it: “If you rent motor vehicles for 30 days or less, you must collect and remit the motor vehicle daily rental fee for each day a vehicle is rented for 30 days or less.” Aplt. App., Vol. II at 320 (emphasis added). And it explains that “the motor vehicle daily rental fee” is comprised of “[t]he daily vehicle rental fee and congestion impact fee.” Id. Thus, consistent with the statute’s language that imposes the Fee on consumers, the form plainly directs car rental companies to collect the Fee from their customers and remit it to the Colorado Department of Revenue.
Oral Argument at 19:06-19:15, Am. Car Rental Assoc. v. Humphreys, No.
8
25-1246 (10th Cir. Mar. 18, 2026), ca10.uscourts.gov/sites/ca10/files/oralarguments/25-1246.mp3.
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(holding that a state tax statute that directs each vendor to “add to the sales prices and
[to] collect from the purchaser the full amount of the tax imposed” is a law that
“imposes the legal incidence of the tax upon the purchaser”). And in any event, we
are not persuaded that this fact, standing alone, is sufficient to overcome the clear
and unambiguous language of Colo. Rev. Stat. § 43-4-806(7.6)(a)(I) and its related
subsections, which indicate that Colorado imposes the Fee on consumers.
Third, and relatedly, ACRA highlights the word “collect” from
Subsection (v)’s language forbidding states to “levy or collect a tax, fee, or charge.”
It argues this term supports preemption because Colorado requires the car rental
companies to collect and remit the Fee. Aplt. Br. at 12; Aplt. Supp. Br. at 5-6. But
this phrase in Subsection (v) is followed by the phrase “upon any business located at
a commercial service airport.” 49 U.S.C. § 40116(d)(2)(A)(v) (emphasis added.).
Read as a whole, the “tax or fee” must be “upon any business,” irrespective of who
collects it.
Fourth, ACRA also argues that the State defendants’ position is “contrary to
the language of Subsection (v)” and “its manifest purpose,” which “is to prohibit
state and local taxes and fees that discriminate against or impose undue burdens on
airport commerce.” Aplt. Supp. Br. at 6. But the language and purpose of
Subsection (v) tell us nothing about who pays the Fee. For that, we must look to the
language of the Colorado statute, which clearly indicates that the Fee is imposed on
consumers rather than car rental businesses.
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Fifth, ACRA complains that “if accepted, Defendants’ argument would
provide an easy roadmap for circumventing” Subsection (v). Id. at 7. It argues that
“[i]f all a state or locality need do to escape preemption is draft the law in a way that
shifts the burden of taxation onto the consumer, then [Subsection (v)] would become
a dead letter.” Id. These arguments ignore Subsection (v)’s plain language, which
preempts only those taxes, fees and charges that are imposed “upon any business
located at a commercial service airport.” 49 U.S.C. § 40116(d)(2)(A)(v). It does not
preempt taxes, fees and charges imposed on consumers.
* * * *
Because Colorado law clearly imposes the Fee on consumers rather than car
rental businesses, we conclude that Subsection (v) does not preempt the Fee.
III. CONCLUSION
Exercising jurisdiction under 28 U.S.C. § 1291, we affirm the district court’s
judgment.
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No. 25-1246, American Car Rental Association v. Humphreys, et al.
EID, J., dissenting.
The American Car Rental Association (“ACRA”) asserts that 49 U.S.C.
§ 40116(d)(2)(A)(v) (“Subsection (v)”) preempts Colorado’s Congestion Impact Fee,
a recently enacted fee of $3 per day (with annual adjustments for inflation) on all
short-term vehicle rentals in the state. Colo. Rev. Stat. § 43-4-806(7.6)(a)(I) (2026);
see also App’x Vol. I at 63. Subsection (v) is the latest congressional attempt to
address state and local taxation burdening interstate aviation travel, and it preempts
state and local efforts to
levy or collect a tax, fee, or charge, first taking effect after [October 5,
2018], upon any business located at a commercial service airport or
operating as a permittee of such an airport that is not generally imposed
on sales or services by that State, political subdivision, or authority unless
wholly utilized for airport or aeronautical purposes.
49 U.S.C. § 40116(d)(2)(A)(v).
The district court granted summary judgment to the state-official defendants,
holding that the Congestion Impact Fee falls within the carveout for taxes, fees, and
charges that are “generally imposed on sales or services” by the applicable taxing
authority. On appeal, the majority affirms this grant of summary judgment, though
on different grounds. The majority instead holds that the Congestion Impact Fee
does not fall within Subsection (v)’s preemptive scope because the Fee does not “levy
or collect a [ ] fee . . . upon any business located at a commercial service airport.”
I disagree with both the district court and the majority, because the Congestion
Impact Fee is preempted by the plain language of Subsection (v). Colorado assesses
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and exacts payment of the Fee from car rental companies, not consumers—a “levy”
upon airport businesses. And Colorado charges the Fee exclusively on one specific
service, short-term vehicle rentals—a fee “not generally imposed on sales or
services.” Accordingly, I respectfully dissent.
I.
This appeal turns on the interpretation of two clauses of Subsection (v), which
all agree is an express preemption provision. To determine the scope of an express
preemption provision, “we focus on the plain wording of the clause, which necessarily
contains the best evidence of Congress’ preemptive intent.” Chamber of Com. of the U.S.
v. Whiting, 563 U.S. 582, 594 (2011) (cleaned up). Accordingly, we deploy our standard
statutory interpretation toolkit, which “begin[s] and end[s] . . . with the text, giving each
word its ‘ordinary, contemporary, common meaning.’” Star Athletica, L.L.C. v. Varsity
Brands, Inc., 580 U.S. 405, 414 (2017) (quoting Walters v. Metro. Educ. Enters., 519 U.S.
202, 207 (1997)). In doing so, we do not look at a single provision “in isolation”; rather,
the “text of the whole statute gives instruction as to its meaning,” so we “look to the
provisions of the whole law” to determine the meaning of the section at issue. Id.
(quotations omitted).
II.
I first analyze Subsection (v)’s threshold requirement that a state “levy or
collect a tax, fee, or charge . . . upon any business located at a commercial service
airport.” 49 U.S.C. § 40116(d)(2)(A)(v). Based on the common meaning of the term
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“levy” and the scheme Colorado statutorily enacted to collect the Congestion Impact
Fee, the Fee falls within this requirement.
First, because the statute does not define “levy,” the court must look to the
term’s common meaning. See Feliciano v. Dep’t of Transp., 605 U.S. 38, 45 (2025).
ACRA directs us to Black’s Law Dictionary, which defines “levy” in the tax context
as “to . . . assess, exact, raise, or collect.” Levy, Black’s Law Dictionary (6th ed.
1990). This aligns with the term’s definition in other dictionaries. E.g., Levy, Oxford
English Dictionary (3d ed. 2015) (defining levy as “to impose (an assessment, rate,
toll, etc.)” and noting this definition is often used with “upon”).
With this understanding of the term “levy” in mind, the court must next
determine whether Colorado “assess[es]” or “exact[s]” the Congestion Impact Fee
upon airport businesses. In my view, it is at this stage that the majority goes awry.
By focusing on the phrase “fee payers” in Colo. Rev. Stat. § 43-4-806(7.6)(a)(I), the
majority overlooks the broader statutory framework supporting the Congestion
Impact Fee—a scheme that operates upon airport businesses, not on their customers.
Most importantly, car rental companies have no obligation under Colorado law
to pass the Congestion Impact Fee on to their customers. As ACRA correctly
identifies, the Fee “must be collected . . . in the same manner in which the daily
vehicle rental fee . . . is collected . . . pursuant to section 43-4-804(1)(b)(II).” Colo.
Rev. Stat. § 43-4-806(7.6)(b). This cross-reference does not include § 43-4-804(1)(b)(I)(A)’s requirement that car rental invoices separately list the Fee, nor any
other requirement that the Fee be passed along to end users. This distinguishes the
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Congestion Impact Fee from the sales tax discussed in the Supreme Court case the
majority cites, see First Agric. Nat’l Bank v. State Tax Comm’n, 392 U.S. 339, 347
(1968) (“It would appear to be indisputable that a sales tax which by its terms must be
passed on to the purchaser imposes the legal incidence of the tax upon the
purchaser.” (emphasis added)), as well as Colorado’s own sales tax regime, see Colo.
Rev. Stat. § 39-26-106(2)(a) (“[R]etailers shall add the [sales] tax imposed . . . to the
sale price or charge, showing such tax as a separate and distinct item.”); id. § 39-26-108 (“It is unlawful for any retailer to advertise or hold out or state to the public or to
any customer, directly or indirectly, that [the sales tax] will be assumed or absorbed
by the retailer or that it will not be added to the selling price of the property sold or if
added that it or any part thereof will be refunded.”).
Without any obligation to pass the Congestion Impact Fee on to their
customers, car rental companies cannot fairly be described as “merely . . .
collect[ing] the Fee and forward[ing] it to the Colorado Department of Revenue.”
Maj. Op. at 12. 1 Colorado’s statutory scheme instead assesses and exacts the Fee
directly and exclusively upon car rental companies. Take Colorado’s applicable tax
form, Department of Revenue Form DR 1777, for example. See App’x Vol. II at 320–22;
see also Colo. Rev. Stat. §§ 43-4-804(1)(b)(II), 43-4-806(7.6)(b) (requiring car rental
companies to use “forms furnished by the department of revenue” when complying
1
The same goes for car sharing programs, which also have no legal obligation to pass the Congestion Impact Fee on to their customers and are required to pay the Fee to the state Department of Revenue. See App’x Vol. II at 320. Contra Maj. Op. at 12.
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with their Congestion Impact Fee obligations). Form DR 1777 requires companies
that rent vehicles on a short-term basis to file a return every month. And crucially,
the Form requires these companies to calculate the “daily rental fee due”—and send
along a corresponding payment—regardless of whether they collected the Fee from
their customers. See App’x Vol. II at 322 (calculating the minimum amount due from
car rental companies without reference to the amount collected). 2
In sum, car rental companies are not required to pass the Congestion Impact
Fee onto their customers, and Colorado assesses and exacts the Fee on car rental
companies without regard to their collections. Accordingly, Colorado’s statutory
scheme operates to “levy” a “fee . . . upon [ ] business located at a commercial
service airport.”
III.
Since the Congestion Impact Fee falls within Subsection (v)’s general ambit,
the court must also determine whether the Fee nevertheless escapes preemption by
falling within the statutory carveout for taxes and fees “generally imposed on sales or
services.” 49 U.S.C. § 40116(d)(2)(A)(v). In my view, it does not.
ACRA ascribes “generally” the meaning of “widely, extensively” and then argues
that a fee that applies exclusively to one service cannot be deemed “generally imposed on
2
The majority notes language in the “General Information” section of Form DR 1777 instructing car rental companies to “collect” the Congestion Impact Fee. See Maj. Op. at 14 n.7; App’x Vol. II at 320. But the majority fails to address the body of Form DR 1777—which, “under penalty of perjury,” App’x Vol. II at 322, requires car rental companies to calculate the amount due (an assessment) and make payment (an exaction) regardless of whether they collected the Fee from their customers.
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sales or services.” Aplt. Br. at 9, 31 (quotation marks omitted) (quoting Generally,
Oxford English Dictionary (3d ed. 2015)). In its view, the modifying language in this
carveout (i.e., “on sales or services”) makes clear that for a tax or fee to qualify for the
carveout from preemption it must be “generally imposed” across the universe of goods
and services as a whole.
The state officials advance a different interpretation of Subsection (v)’s carveout.
They believe “generally” means something done in a manner that involves or belongs “to
every member of a class, kind, or group.” Aple. Br. at 19 (citing Generally, Webster’s
Third New International Dictionary (2002)). In their view, since the Fee applies to all
short-term vehicle rentals made in the state, the Fee applies to “every member of a class”
and is, therefore, generally imposed.
I find ACRA’s interpretation more persuasive. In particular, even if one were to
adopt the state officials’ definition of “generally,” their argument overlooks the fact that
the statute already specified the relevant “class, kind, or group” that the tax, fee, or charge
must cover: “sales and services.” As a result, the Congestion Impact Fee—which is only
imposed on one type of service—cannot satisfy the state officials’ own test of generality.
The state officials offer two primary counterarguments, 3 but neither persuades.
First, the state officials argue that ACRA’s interpretation would read “fee” out of the
3
The state officials also offer a bevy of dire “policy implications” that ACRA’s reading of Subsection (v) would generate—most notably, that their interpretation would prohibit “any new targeted tax or fee without exempting airports or using the revenue collected from airport businesses exclusively at the airport.” Aple. Br. at 35, 37; see also id. at 35–44. But “policy concerns cannot trump the best interpretation of the statutory
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statute as, by definition, there is no such thing as a generally imposed fee. But the
“generally imposed” exemption from preemption is not logically required to encompass
fees (or charges for that matter). A perfectly sensible statute could preempt the entire
universe of “tax[es], fee[s], and charge[s]” while only exempting from this preemption
generally imposed taxes. Put differently, the “tax, fee, or charge” language ensures that
Subsection (v) covers the waterfront of potential state and local financial impositions, but
this broad language does not demand a similarly expansive “generally imposed”
exemption.
Second, the state officials’ interpretation is not mandated by the preambulatory
language preceding Subsection (v). In the lead up to its enumeration of prohibited taxing
practices, the statute provides that “[a] State, political subdivision of a State, or authority
acting for a State or political subdivision may not do any of the following acts because
those acts unreasonably burden and discriminate against interstate commerce.” 49 U.S.C.
§ 40116(d)(2)(A). But it would be an overreading of Congress’s invocation of its
Commerce Clause authority to narrow Subsection (v)’s application to only laws that treat
on- and off-airport transactions differently. After all, a state can just as easily
“unreasonably burden and discriminate against interstate commerce” via taxes that target
goods and services predominately used at airports (such as car rental services).
All in all, Subsection (v)’s carveout for taxes “generally imposed on sales or
services” is best read to encompass taxes that apply widely across the entire universe
text,” Patel v. Garland, 596 U.S. 328, 346 (2022); therefore, I do not discuss these arguments further.
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of “sales and services.” And because the Congestion Impact Fee only applies to one
service, short-term car rentals, it does not qualify for this exemption from preemption.
IV.
Colorado’s Congestion Impact Fee is “lev[ied]” on airport businesses and is
“not generally imposed on sales or services.” 49 U.S.C. § 40116(d)(2)(A)(v).
Accordingly, the Fee is preempted by Subsection (v). I therefore respectfully dissent.
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